Asia stocks slide as China manufacturing shrinks

KELVIN CHAN

HONG KONG (AP) — Asian stock markets slid Monday after a survey showed that Chinese manufacturing shrank in April for the fourth month in a row.

The results of the HSBC purchasing managers' index on Chinese factory activity were lower than than a preliminary reading, stoking fears among investors that the slowdown in the world's second biggest economy is entrenched.

"A lot of concern there about slowing again," said Andrew Sullivan, director of Asian sales trading at Kim Eng Securities. "People were in general expecting from the recent data that the market was stabilizing rather than slowing. This would seem to indicate that it's still slowing rather than stabilizing."

Pessimism about China's manufacturing also offset some positive news on U.S. employment that showed employers in the No. 1 economy added more jobs than expected in April, pushing the unemployment rate to its lowest in six years.

Price changes were also more volatile because several major markets were closed, cutting trading volume, Sullivan said.

Markets in Japan and South Korea were closed. British markets would also be closed for a public holiday.

Hong Kong's Hang Seng fell 1.5 percent to 21,917.39 and the Shanghai Composite in mainland China lost 0.7 percent to 2,011.54.

An announcement by China's securities regulator on Sunday night unveiling prospectuses for 25 IPO applicants also added to downward pressure by raising fears that supply of stocks would exceed demand.

Australia's S&P/ASX 200 dipped 0.2 percent to 5,449.50. Benchmarks in Taiwan, Singapore and New Zealand also fell.

On Wall Street on Friday, the Dow lost 0.3 percent to close at 16,512.89 and the Standard & Poor's 50 fell 0.1 percent to 1,881.14. The Nasdaq dropped 0.1 percent to 4,123.90.

In currencies, the dollar fell to 101.91 Japanese yen from 102.20 in late trading Friday. The euro rose to $1.3878 from $1.3871.

In energy markets, benchmark U.S. oil for June delivery edged up 2 cents to $99.78 in electronic trading on the New York Mercantile Exchange. The contract rose 34 cents to settle at $99.76 on Friday.